QR codes – dead or alive?

Fri, 11/29/2013 - 10:15
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There has been a lot written about the life, death and subsequent resurrection of Quick Response (QR) codes during 2013. As it is a particularly hot topic at the moment I think it is a subject that demands our attention. I’m going to try and make sense of this technology from my perspective in China and look at what the future might hold.
 
Are QR codes dead?
  image courtesy of marketingland.com

QR code news during 2013

First I want to examine what there is out there about QR codes. In January this year emarketer.com talked about the use of QR codes in the US and Western Europe. Then in April Aaron Strout at marketingland.com talked about the demise of them before revising his argument in November to say that QR codes are not as dead we think. Or as dead as he thinks anyway.

Unfortunately the emarketer.com article only looked at studies done in Western countries. As yet I can’t find any English language studies that have looked at China and if anyone has any information related to this I’d love to see it. According to Chinese sources the QR code market is developing rapidly in China. Every month over 160 million consumers scan a QR code.

On 25 November Taobao.com announced that it was going to launch a new QR code service. Every goods page will now have its own exclusive code. Users can scan the code to buy the product and then carry on browsing the page and check out at the end.

Some forecasts suggest that by 2015 the QR code market in China could be worth 100 billion RMB ($16.4 billion) and that more than 10,000 companies will enter into the QR code market. Below I’m going to give my views on QR codes in China using various statistics and anecdotal evidence that I have collected recently.
 

Quick Response codes in China

QR codes are a way to store information that can be picked up by a reader very quickly. As with lots of these types of technologies its use has expanded from what was originally conceived.

I had never heard of them before I moved to China in 2011, but when I started using the Chinese social media mobile app WeChat from Tencent I discovered that people used them to exchange personal details from phone to phone using the scanner that was built into the app. Rather than telling someone your number you scan their QR code and your WeChat accounts are connected. No confusion or giving or receiving an incorrect number.

The image below shows what are the most popular apps in China. WeChat is very popular and therefore most people are familiar with the technology.
 
Top smartphone app in China
image courtesy of go-globe.cn

For this reason QR codes can be seen everywhere in China. To see how ubiquitous they are I did an experiment. On my way to work one morning I decided to take a picture of every code I saw. As it turns out they are everywhere in Nanjing. The image below is a montage of just four I saw on my journey from the metro station to my office.
 
various QR codes in Nanjing

From top right in a clockwise direction I saw: a billboard size ad on the wall of the metro station as I got off the train; an advert on a poster on the door of a bookshop; a small billboard ad for a jobs website on the exit of an underpass and a magazine advert in the lobby my office building.

I’m not able to add all the pictures I took to this blog post as there’s simply not enough space, but other examples included codes on a marketing stand of an English school for Chinese kids, codes on examples of wedding photography marketing and lots more examples on posters for various products on the walls of the metro station.

What stood out in the metro station for me was the fact that the very prominent Mircosoft Surface adverts, Microsoft’s tablet version, did not have a QR code. One criticism of QR codes is that they take up valuable space and look cluttered. If you look at a Chinese website you might say it looks cluttered too. Understanding this cultural difference could help western marketers to think how better to integrate QR codes into their advertising.

What else are these codes used for in China? Well, just about everything. Talking to my Chinese colleagues about QR code use I was informed that they are used:

  • As complaint forms. For example if the bus or train you are travelling on is not up to your standards you can scan the code near the door and add the bus/train number with your comments. You can also praise a good driver too.
  • To find out more about TV shows. When a code pops up on TV you can scan it and it takes you to a website or you can view promotions.
  • If you are watching a music video on a streaming site and want more information about the band or extra videos.
  • To login into various websites from your phone.
  • As a way of verifying your identity before taking your exams at school!

As you can see from the infographic below all of the above uses are connected with the most popular smartphone activities in China.
 
Smartphone usage activities in China
image courtesy of go-globe.cn

Which brings us to the most pertinent use from the perspective of a marketer: online shopping.
 

Online shopping in China

Recently I wrote about Chinese online shoppers and how they are becoming an important area for businesses to target. And with many of these cybershoppers moving to using their mobile device to make transactions it is no surprise that the giant Chinese firms Tencent and Alibaba have begun to take a very big interest in this area of e-commerce.

Through the WeChat app, which Tencent says 270 million people use every month, users can now take care of all their e-shopping needs. It’s possible to link your bankcard to your phone and then make quick online purchases by scanning a QR code. You can also track deliveries, review products and services, and tell your friends about it. By moving into e-shopping Tencent is stepping on undisputed industry leader Alibaba’s toes.

In turn Alibaba has launched it’s own mobile messaging apps, Laiwang and Weitao, to compete with WeChat. It already has Alipay, its own online payment service which has around 100 million registered users; think of a Chinese version of PayPal. Alibaba has turned its attention from shopping on standard computers to mobile devices and in the process started an online turf war in China.

Alibaba wants their mobile messaging apps to control 30 per cent of the messaging market. The apps Tmall and Taobao (which are also websites) were launched in 2009 and now have 320 million registers users. During the recent Singles Day sales on 11 November over 1 million vendors handled 10 per cent of their sales on these apps. During last year's sales day 8 per cent of Alibaba’s transactions went through Alipay. This year the figure rose to 24 per cent. Who would bet against this going up again next year.
 

How QR codes can be used

Since I understood the significance of QR codes beyond using them to swap numbers with friends I have used them for all sorts of reasons. On my WeChat app I get updates from different accounts I have added to my subscriptions. The image below shows updates I get from a hotel restaurant about special offers (for when I really need a Western meal!) and also a quirky toilet themed café called More Than Toilet I stumbled across while in Shanghai.

Example of QR codes

I also get updates from various leisure activities I like to partake in in the evenings or weekend. The next image shows updates from a bar that does different themed nights during the week. This also sometimes includes special offers that only people with a subscription can get. The other one is for a nightclub that has regular foreign acts and also includes special offers such as guest list and reduced entry.
 
Example of QR codes

Some interesting ideas for how to use QR codes could be to have a code on your business card. One quick scan and you have all the details you need so that if you lose the card you don’t lose the contact. I see this a lot in China especially for bars and restaurants. Another idea would be to add a map and maybe even a copy of the menu when you scan the code. The technology is there it just needs some creativity to take it to the next level.
 

Do you use QR codes? How prevalent are they where you live? Can you think of any other uses for QR codes to help with marketing different businesses? I’d love to know what people think about this.
 
 

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Comments

The biggest issue I have with QR codes is the fact that I have to start QR scanning app every time I need to scan one. I also found that there are still plenty of people that have no idea what QR code even is.

I think whether QR codes are here to stay or not depends on the the willingness of Apple and Google to integrate QR code scanning capabilities into iOS and Android. If all you need to do to scan it is point and shoot, than their use will be much more widespread.

Val - this has been one of my biggest issues with QR codes in the US at least (lack of ubiquity on mobile platforms). Sounds like this is starting to change.

I think there'll be lots of new information re QR codes in the near future. I'll let you know what I find.

Hi Val. If you have an iPhone updated to iOS7 then you have a QR code scanner built into the passbook app. Open the app point and scan. I'm not sure about Android to be honest.

I agree that there are lots of people who don't know what a QR code is but this is changing as the eMarketer reports suggests. In fact I've come across a study with QR code usage in China so I'll write something about that soon.

Do you use QR codes at all? Do you think they are useful in general?

Thanks for the tip about passbook app, Misha. I do use QR codes and find them useful. I think they'll be around until some other technology will eventually replace it one day.

I guess all technology gets replaced eventually, do you use CDs anymore? But I think that this is just the tip for QR codes. They could really take off with a bit of imagination.

No problem about the tip Val, you're welcome.

I think that QR codes are here to stay. When i traveled to Argentina a few months ago to attend a forum I noticed they use QR codes VERY often, much more than in China. You can see every store/shop/hotel shows a QR code to check their business/tax registration. And yes, this technology is just starting, the uses are infinite.

That's really interesting George. In England, where I'm from, I don't see QR codes anywhere. Since I've lived in China I see them everywhere. Reports suggest their use will increase.

It'd be good to know how prevalent their use is in other parts of the world and what they're used for.

I'm at a trade show now in Shenzhen and QR codes are practically on every poster or graphics, big or small. QRs were on at least a third of the name cards I got today! Either I'm just noticing them more or they are becoming more widespread.

On the other hand, I got to say - I never saw anyone actually scanning them...

Maybe now is the time to start scanning Val! See what information you get. I'd love to know what sort of information people are sharing. I guess the business cards will have personal details, but creative people might give you something extra.

If you find anything interesting then please share it with me.

What show are you at by the way?

The trade show I'm at is called HKPCA, it's a local PCB show. I'm also interested in QR codes and the best ways to integrate them into different marketing assets. I took some pictures here and will be writing about what I saw in my blog as well in the coming days(http://chinamarketingtips.com/).

Make sure to let me know when that blog is posted Val. It'd be good to see how QR codes are being used currently and to see how they might be integrated into different marketing in the future.

Hi Misha,
I've just posted my take on QR codes usage in China in my blog, check it out: http://chinamarketingtips.com/qr-codes-alive-and-kicking/

I've linked to your post as well.

Cheers,
Val

Thanks for letting me know Val. I'll check it out.

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